Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of...

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Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of...

Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two departments using different allocation bases. The following information is available for the current period:

OFFICE EXPENSES	TOTAL	ALLOCATION BASIS
SALARIES	51,000	NUMBER OF EMPLOYEES
DEPRECIATION	30,500	COST OF GOODS SOLD
ADVERTISING	71,500	NET SALES
ITEM	DRILLING	GRINDING	TOTAL
NUMBER OF EMPLOYEES	2680	4020	6700
NET SALES	359125	524875	884000
COST OF GOODS SOLD	106500	177500	284000

The amount of the total office expenses that should be allocated to Grinding for the current period is (Do not round your intermediate calculations.)

A. 70,266

B. 600,000

C. 153,000

D. 61,016

E. 92,116

business accounting

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Answer 1

Answer #1

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E. $92,116
Working note
Salaries	$ 30,600	51000*4020/6700
Depreciation	$ 19,063	30500*177500/284000
Advertising	$ 42,453	71500*524875/884000
Total	$ 92,116	.

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